GRC Risk Assessment and Identification Techniques 2

Question 1

Which analytical framework examines Political, Economic, Social, Technological, Legal, and Environmental factors to identify external risks?

Accepted Answer

PESTLE analysis

Answer

PESTLE analysis scans the external macro-environment across six categories to surface strategic and operational risks beyond the organization's control.

Question 2

In quantitative risk assessment, Monte Carlo simulation is used to:

Accepted Answer

Run thousands of random scenarios to model the probability distribution of potential outcomes

Answer

Monte Carlo simulation repeatedly samples random values for uncertain variables to produce a statistical distribution of possible risk outcomes and their probabilities.

Question 3

What is the definition of 'residual risk' in a GRC context?

Accepted Answer

The portion of risk that remains after controls and mitigation measures have been applied

Answer

Residual risk is the remaining level of risk exposure after the organization has implemented its chosen controls and mitigation actions.

Question 4

Key Risk Indicators (KRIs) are best described as:

Accepted Answer

Leading metrics that provide early warning signals that a risk may be increasing

Answer

KRIs are forward-looking metrics that signal a rising probability of a risk materializing, enabling proactive management before the event occurs.

Question 5

Fault tree analysis (FTA) is a risk assessment technique that:

Accepted Answer

Uses a top-down, deductive logic diagram to trace causes leading to an undesired top event

Answer

FTA starts with an undesired outcome at the top and deductively maps the combinations of failures or faults that could cause it using AND/OR logic gates.

(GRC) Governance, Risk, and Compliance Certification Practice Test

(GRC) Governance, Risk, and Compliance Certification Practice Test

GRC Risk Assessment and Identification Techniques 2